Friday, February 14, 2014

To Make Virtual Teams Succeed, Pick the Right Players

Setting up small, high-performing virtual teams has enormous potential for companies to increase sales, penetrate new markets, improve business processes and come up with the next generation of disruptive innovations. But putting together a great team is tricky.

Part of the problem is that teams—both the virtual and co-located types—are often thrown together without much thought or planning.

At a large, multinational manufacturing company Ferrazzi Greenlight recently worked with, a virtual team was formed to deal with the company’s complex interdependent businesses. The goal was to optimize decision-making all along the value chain and boost earnings by tens of millions of dollars.

But when we looked under the covers it was clear not enough thought had gone into selecting members. The team was huge—more than 30 people—with a mixture of business, manufacturing, and commercial leaders, some of whom reported to each other. Many who were selected (seemingly because of seniority) lacked the deep technical knowledge vital for optimization decisions. By the time we were asked to help, members openly acknowledged that the team was in disarray and its decisions had failed to boost earnings as expected.

As the manufacturer discovered, getting team composition right is critical. That’s especially true for virtual teams, which are more autonomous than co-located teams. Leaders of virtual teams must work harder to develop trust and rapport among team members who lack the frequent informal exchanges and visual and body language cues of co-located teams—vital feedback mechanisms that help keep team members’ efforts aligned.

The manufacturing company is not alone. In many companies, teams seem to come together out of nowhere, grabbing any available resource, operating without adequate planning, and then fail to gel. Months or even years later, senior executives have to face the unpalatable truth: the virtual team that was put together to slash costs is not only dysfunctional, it was a drain on your bottom line.

These problems generally originate at the beginning of the process, when the team is put together. That’s why it’s important to focus on team composition—the size and structure of the team, as well as the skills members bring to the team, including interpersonal skills. These attributes are among the most important predictors of team success.